Labour markets must be opened: now

The leaders of the 15 older EU states have done a very bad job of communicating enlargement to their citizens. They should now alleviate their citizens’ visceral fear of enlargement by lifting restrictions on the right of workers from new member states to be employed on their territory.

European Voice

1/18/06, 5:00 PM CET

Updated 4/12/14, 12:10 PM CET

Under the terms of the accession treaty, member states can restrict for at least two years (until 1 May 2006) the right of citizens from new member states to enter their labour markets. All of the 'old' member states except the UK, Ireland and Sweden introduced such restrictions. Before 1 May, the Council is to review how these transitional provisions are working on the basis of a report from the European Commission. But the result of the review is not binding on the member states. Those who wish to continue restrictions can do so after having notified the Commission. Finland, Spain and Portugal are contemplating lifting the restrictions from 1 May, but the remaining nine states are likely to prolong them.

As a rule, restrictions would end in 2009. However, a member state can be given permission to apply national measures until 2011, once having notified the Commission, in case of serious disturbance of its labour market - or a threat of such disturbance. Only in 2011, seven years after enlargement, would all restrictive measures end.

The Commission - which should represent the 'European' interest but which as a body comprising one representative from each member state often mirrors the debates in the Council, which is representing member states' interests - is divided on the free movement of workers from the new member states.

But the case for ending the restrictions is strong.

Legally, curbing the right of citizens of one state to seek employment in another state is an anomaly. The restrictions suspend one of the basic principles of the EC Treaty, the free movement of persons, one of the four freedoms on which the single market is based. As guardian of the EU treaties, the Commission must argue for lifting these restrictions, in order to reinstate the treaty rules across the Union.

Economically, the free movement of workers is good for growth. One of the crucial elements in Europe's reform blueprint, the Lisbon Agenda, is boosting the flexibility of labour markets and the mobility of workers - both the geographic mobility and their adaptability to new jobs. There are hardly any economic arguments that would justify restrictions on the mobility of workers from the new member states.

Politically, these restrictions send out the wrong message. They are giving people the impression that there is a problem, which they are meant to tackle, and that without such curbs, new member states' workers would flood the labour markets of the older and richer states. But statistics and experience suggest that such predictions of a big influx of new member states' workers would not materialise - just as it did not materialise 20 years ago, when Spain and Portugal joined the Union.

Initial statistics from those states which did not impose restrictions have shown that labour flows and their effects have not been dramatic. There were lower than expected flows to Sweden, the only country which also granted equal access to its welfare system for nationals of the new member states, and studies show that migrants have not become benefit tourists. Studies also show that the migrant workers to the UK and Ireland took hard-to-fill jobs, making up for the lack of skilled local workers and thus boosting the economy.

Keeping the restrictions in place would strengthen populist claims that enlargement is a threat to the old member states' economies and labour markets. It would perpetuate the myth of the Polish plumber.

Instead, the old member states should open their labour markets and take more specific measures to prevent their welfare systems being abused and to prevent social dumping. They would be entitled to take measures to deter companies from sacking more expensive western workers to employ cheaper Eastern European ones. Each member state should have the right to demand that all work within its borders respects the country's minimum wages provisions and health and safety rules, as well as environmental protection norms.

By lifting these labour market restrictions, EU leaders can start correcting misconceptions about enlargement and the EU and can help build more trust in Europe.

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